Centralised processing of returns furnished with Post offices / electronically. - Income Tax - Instruction No. 07/2006

INSTRUCTION NO. 7/2006 Dated: October 10, 2006 Subject: Centralised Processing of Returns furnished with Post-offices/electronically - reg. The Central Board of Direct Taxes have notified following new return forms for Assessment Year 2006-07:- (i) Form No.2F vide Notification S.O.No.848 (E) effective from 1st June, 2006. (ii) Form No.1, Form No.2, Form No.3, and Form No.3B vide Notification S.O. No. 1163(E) effective from 24.7.2006. These Forms are available at http://incometaxindiaefiling.gov.in. If a taxpayer intends to file a return for any earlier assessment year he will have to use the old forms. 2. It has been made mandatory to furnish e-return by the corporate taxpayers after 24.7.2006. However, for other taxpayers it is optional to furnish the return electronically. Some important aspects relating to these new forms and furnishing thereof electronically have been clarified by the Board vide Circular No. 9/2006 dated 10.10.2006. It is imperative that this Circular may be carefully gone through. 3. It has been decided by the Board that the following returns are to be processed centrally:- (i) Returns furnished at postal offices. (ii) Returns furnished under the Electronic Furnishing of Return of Income Scheme, 2004 [Notified vide S.O. No. 1073(E) dated 30.9.2004]. Under this Scheme, e-return has to be filed through e-Return Intermediary, followed by a paper return. (iii) Returns furnished under the Furnishing of Return of Income Internet Scheme, 2004. [Notified vide S.O. No. 1074(E) dated 30.9.2004]. (iv) Returns furnished under two step-procedure. First step is to transmit the details of the return and schedules thereto electronically (without digital signature and thereafter to furnish a paper return. (v) Returns furnished under digital signature. 4. For centralised processing of above mentioned returns, following procedure has to be followed:- (i) In the region of each Regional Computer Centre (RCC)/Computer Centre, the concerned Chief Commissioner of Income-tax shall designate at least one officer to ensure that all the returns furnished with the postal offices are collected and stored centrally. (ii) As mentioned in item (vii) of para 6 of Circular 9/2006 dated 10.10.2006, concerned Chief Commissioner/Director General of Income-tax shall make necessary arrangement to separately receive the paper returns in respect of e-returns. These returns shall be transferred to the Assessing Officer designated for centralised processing of these returns. (iii) Every cadre Controlling Chief Commissioner, in consultation with other Chief Commissioners/ Directors General of Income-tax of his region will decide the number of Assessing Officers (hereafter named as designated Assessing Officers) required for centralised processing of the above mentioned returns for each RCC/CC in his region. The designated Assessing Officer should be based at net-work stations only. (iv) Every Chief Commissioner/Director General of Income-tax shall pass an order assigning concurrent jurisdiction to the Assessing Officers selected by the Cadre Controlling Chief Commissioner in accordance with (iii) above for purpose of processing the return under section 143(1). The concurrent jurisdiction to the designated Assessing Officer shall be only in respect of the following:- a. processing of the return under section 143(1); b. issue of intimation/demand notice/issue of refund in respect of processing under 143(1); c. rectification under section 154 in respect of such processing; The Board has issued Notification S.O.No.1743(E) dated 10.10.2006 authorising every Chief Commissioner and Director General of Income-tax to issue orders for exercising concurrent jurisdiction in this regard by such designated Assessing Officer(s) over all the cases assessed or assessable with the Assessing Officers subordinate to him. (v) Where more than one Assessing Officer has been designated by the Cadre Controlling Chief Commissioner for a RCC or CC, it should be ensured by each Chief Commissioner/Director General in his region that all such designated Assessing Officers are assigned the jurisdiction concurrently for the purpose of centralised processing of the returns. (iv) The cadre Controlling Chief Commissioner of Income-tax shall ensure that adequate number of Senior Tax Assistants/Tax Assistants (erstwhile Data Entry Operators) are posted with the designated officers for data entry and processing of paper returns. (v) The Joint Commissioner/Additional Commissioner of Income-tax, Commissioner of Income-tax, Commissioner of Income-tax (Appeals) or Chief Commissioner of Income-tax will continue to hold the jurisdiction over such processed returns, as at present. (vi) The jurisdiction over a case for all the actions after selection of the case for scrutiny shall rest with the Assessing Officer with whom the designated Assessing Officer exercises the concurrent jurisdiction. (vii) The processing of revised returns in above-mentioned cases will also be carried out centrally by the designated Assessing Officers. (viii) Where e-return does not tally with the paper return, the designated Assessing Officer shall correct the data in the e-return and process the case accordingly. (ix) The designated Assessing Officer shall generate intimation in every case and send the same under his signature. The demand notice or refund, if any, shall also be issued by the designated Assessing Officer. (x) If the return of income is filed in Form No.2F, or the new annexure-less Form No.1 or new annexure- less Form No.2 or new annexure-less Form No. 3, credit for TDS/TCS shall be given on the basis of information furnished in the return as if the TDS/TCS certificates were filed. It is not necessary to undertake verification of all TDS claims except in select cases as required in Chapter-9 of Paragraph 22 of Volume-II of the Manual of Office Procedure. (xi) If there is a refund, the designated Assessing Officer shall, before completing the processing of the return, adjust the demand, if any, outstanding as per Individual Running Ledger Account (IRLA). (xii) If the amount of refund after adjustment of demand as per IRLA does not exceed Rs. 25,000/-, the processing shall be completed and the refund, if any, shall be issued forthwith. (xiii) If the amount of refund after adjustment of demand as per IRLA exceeds Rs. 25,000/-, the designated Assessing Officer shall send a letter to the concerned Chief Commissioner/Director General of Income-tax requesting him to intimate the demand, if any, outstanding in the record of the Assessing Officer. The concerned Chief Commissioner/Director General of Income-tax shall, within 15 days from the receipt of such letter, intimate the demand, if any, to be adjusted by the designated Assessing Officer. The refund, if any, shall be issued within 20 days from the date of sending the letter to the Chief Commissioner/Director General of Income-tax. (xiv) No separate approval of refund by CCIT/CIT/Addl. CIT/JCIT shall be required. (xv) Copy of demand notice/intimation slip shall also be sent to the Assessing Officer with whom the designated Assessing Officer exercises the concurrent jurisdiction. (xvi) The paper returns processed by the designated Assessing Officer shall be centrally stored with the designated Assessing Officer. If required, the Assessing Officer with whom the designated Assessing Officer exercises the concurrent jurisdiction may obtain a copy of the return from the designated Assessing Officer. (xvii) In case of any default noticed by the designated Assessing Officer which may attract any penalty provision, the designated Assessing Officer shall intimate the same to the Assessing Officer for taking the decision to initiate or not to initiate the penalty proceedings. No penalty proceeding shall be initiated by the designated Assessing Officer. F.No.133/38/2006-TPL (Sharat Chandra) Secretary, CBDT